State's bonus program cost taxpayers $43 million

By Brian Lockhart, Staff Writer

Published 9:56 pm, Wednesday, March 10, 2010

Despite the state's historic budget crisis, Connecticut state employees are in some cases earning thousands of dollars in annual rewards for staying in their government jobs, a bonus program that cost state taxpayers $42.9 million last year.

Around 35,000 employees, union and non-union, spread throughout the three branches of government and higher education institutions, receive "longevity" payments split between the months of April and October, according to data provided by the Office of the State Comptroller.

Eligibility begins on the employee's 10th anniversary. Payments increase after 15, 20 and 25 years of service.

The longevity benefit has existed in statute since the 1960s. Payments to unionized workers have been subject to collective bargaining since the 1970s.

While unionized employees' semi-annual longevity payments typically range from a $75 minimum to $1,067 maximum, non-union managers and others earn thousands of dollars more. The system also rewards politicians who move into a state job by counting their years in elected office toward when they qualify for longevity pay.

Just over 2,500 employees earned over $4,000 per year, and 38 of those earned $10,000 or more.

"I'm surprised. Yeah," House Speaker Christopher Donovan, D-Meriden, said when shown the higher figures. "It's another thing for us to look at."

Sen. Gayle Slossberg, D-Milford, who has been working on proposals to lower the cost of government, believes longevity payments "need to go."

"We can't afford to pay people for just showing up," she said. "Most of these people do a fabulous job, (but) in this economy most would be happy to have a job at all."

House Minority Leader Lawrence Cafero, R-Norwalk, has also been calling for limitations on longevity pay as part of his caucus' proposals to cut the budget.

"I'm not so sure the public sector with taxpayer money can afford to do that anymore," he said.

But Cafero, a former member of the Norwalk Board of Education, acknowledged longevity pay is not an unusual concept in the public sector.

"My first introduction to a longevity payment was when I was chairman of the board (during) negotiations with the teachers," he said.

According to the Connecticut Conference of Municipalities, many cities and towns provide some type of longevity pay to their employees.

"It was in the Stamford contracts. It's in the Norwalk contracts," said Norwalk Finance Director Thomas Hamilton, who has worked in both cities' finance departments. "But it's generally not at the kind of dollar thresholds the state has. & It's in the hundreds-of-dollars. Not the thousands."

Rell in 2009 unsuccessfully proposed legislation that would have eliminated longevity pay for employees who had yet to reach their 10-year anniversary, and frozen it for those already receiving the benefit.

According to Rell's budget office, lawmakers cannot legally end current payments to those already receiving longevity pay because at that point it is considered wages.

But an individual who worked for the state for 24 years and is earning the related, 20th-anniversary longevity payments, could be denied the expected increase at their 25-year anniversary.

The governor's legislation would have applied to non-union employees but been extended to unionized workers once existing contracts expire in 2011.

But there is some disagreement among Democrats, who have a majority of the seats in the General Assembly, over whether to take longevity pay away from organized labor.

Slossberg said there is a big difference between the thousands of dollars some high-paid managers are earning and what some union members get.

Matt O'Connor, a state employees' union spokesman, said longevity pay helps to ensure good workers who have climbed as far as they can in their given position remain at that post rather than pursue higher-paying management options.

"What you frequently find is you have employees with a particular skill set who like what they do, enjoy the work, are vital to a given task and have reached that point -- perhaps it's 10 or 15 years of service -- where they've reached that top step and the only other place for them to go is literally out of that position," O'Connor said. "The way to incentivize them to stay is provide those longevity opportunities."

But Sen. Edith Prague, D-Columbia, co-chairman of the legislature's Labor Committee, said the only fair and practical approach to curtailing longevity pay might be to impact everyone's piece of the pie.

When the 2010 legislative session began last month, Prague introduced a bill eliminating longevity payments for non-union managers earning over $100,000.

"Here we are. We don't have any money and people (earning) over $100,000 -- these managers who have been here longer than 10 years -- are getting longevity," Prague said.

But she has since withdrawn the bill, saying she realized it is a complicated issue that warrants further research and discussion. Prague said she heard from at least one manager complaining that unionized staff is already earning more than they are.

"We have to be fair," Prague said. "You can't separate the union from non-union folks."

Robert Genuario, a former Republican state senator from Norwalk and Rell's budget chief, said capping or eliminating longevity for managers but leaving the unions' money untouched will cause problems.

"The elimination of longevity is nothing the administration is philosophically opposed to," he said. "It needs to be done in an even-handed fashion if it's going to work."

Genuario said he could envision circumstances where his office would lose good, non-union workers to unionized positions within state government if their longevity pay was cut.

He said the legislature could alter state statutes to ensure longevity pay is no longer an arbitrated contractual issue.

Further complicating the debate, Prague and others argue that while longevity payments to some managers may at first glance appear high, in some cases they are not necessarily undeserved.

Prague believes Carter has done a fantastic job for the CSU system.

"If he worked for Connecticut College or Yale he'd be making three times what he's making," Prague said.

The CSU trustees like Carter so much that in October they also voted to give the chancellor a controversial, $25,000 "retention award" for not taking advantage of the early retirement incentives lawmakers offered last year. But Carter has since declined the money, according to a spokesman.

Asked for a statement on Carter's $24,049 longevity payment -- which is distinct from the retention award -- CSU spokesman Terri Raimondi said: "The Connecticut State University System did not create, increase or enhance the longevity system. The policy has been in place for many years throughout state government and at CSUS."

Sen. Andrew McDonald, D-Stamford, co-chairman of the Judiciary Committee, said while "all aspects of compensation and benefits" should be on the table, he noted the judges who are also receiving longevity payments have not received a salary increase since January 2007.

"There are judges I know of who in private practice were making more than $400,000," McDonald said. "Because the call of public service was so strong they were willing to take a very substantial hit on compensation."

Patrice Peterson, a state employee who teaches adults with mental health and development issues, has been a public employee for 32 years. On top of her base salary of $86,000, each April and October she receives the maximum $658 longevity payment for her position.

"When I was younger the money really helped," said Peterson, who is also a union official. "At this point in my career & it's a thank-you for the work we have accomplished."

Staff Writer Brian Lockhart can be reached at brian.lockhart@scni.com.